I guess it depends on how much money you're talking about. Most planned home repairs/car replacements should be saved up for in less than a year so I would just let it accumulate in a savings account. It helps if you don't have expensive taste. For example a replacement car for me might cost $20,000. Say my current car is worth $5000 that gives me a year to save up $1250/mo for a year which fits in my budget. Same with a house repair--whats the biggest ticket maintenance item? The roof? $9,000 or so every 25 years? The year you want to replace it set aside $750/mo and replace it.

We put it in the prime money market at Vanguard. I combine the short term money and emergency money and just call it all short term money to keep it simple.

+1. Sounds like both the auto and house expenses are well into the future so I wouldn’t worry too much about them now. Just invest most of your money in a taxable account and set aside a comfortable amount in your emergency fund if you have one.

Since we tend to drive cars until they stop driving and most most of our house expenses are unforseen (i.e. the water heater springs a leak), we just keep the money in our emergency fund. I like to keep between a year and 18 months of expenses in my emergency fund so if we need a car or a major repair for our house, we just take it out of there and then build it back up again. This is in a plain savings account. For planned housing expenses, we generally have enough foresight to save up enough money ahead of time from our regular income.

Haven't had to do this yet, but the plan is to keep the money invested in my taxable account in either Total Stock or Total International. If I need to withdraw a large amount, I'll sell the lots with the most favorable tax consequences.

If this happens during a time when stocks are down, I'll sell an equivalent dollar amount of bonds in my 401k and transfer it to stocks so that my overall stock shares are unchanged and I don't sell when stocks are low.